NEW YORK, Oct. 30, 2019 (GLOBE NEWSWIRE) -- PDL Community Bancorp (the “Company”) (NASDAQ: PDLB), the holding company for Ponce Bank (the “Bank”), reported net income of $709,000, or $0.04 per basic and diluted share, for the third quarter of 2019, compared to $950,000, or $0.05 per basic and diluted share, for the prior quarter and net income of $402,000, or $0.02 per basic and diluted share, for the third quarter of 2018. For the nine months ended September 30, 2019 and 2018, net income was $2.3 million and $2.0 million, or $0.13 and $0.11 per basic and diluted share, respectively.

Carlos P. Naudon, President and CEO remarked that, “the year-to-date results are evidence that management remains focused on executing on its core business while investing in capturing growth opportunities and executing strategic initiatives. The increase in net interest income from the prior year reflects the balancing of loan growth and asset quality, the increase in occupancy and equipment expense evidences the continued branch transformation initiative, and the shares repurchased this year have added value to shareholders.”

Net Income

The $241,000 decrease in net income from the prior quarter reflects a $627,000, or 7.2%, increase in noninterest expense, a $118,000, or 3.8%, increase in interest expense, a $107,000, or 15.6%, decrease in noninterest income and a $14,000 increase in provision for loan losses, offset by a $539,000, or 4.3%, increase in interest and dividend income and a $86,000, or 23.1%, decrease in provision for income taxes.

The $307,000 increase in net income from the same quarter last year reflects a $1.2 million, or 10.4%, increase in interest and dividend income and a $588,000 decrease in provision for loan losses, offset by a $698,000, or 28.0%, increase in interest expense, a $565,000, or 6.4%, increase in noninterest expense, a $135,000, or 18.9%, decrease in noninterest income and a $99,000, or 52.7%, increase in provision for income taxes.

Net income for the nine months ended September 30, 2019 and 2018 was $2.3 million and $2.0 million, respectively. For the nine months ended September 30, 2019, net income reflects an increase of $3.9 million, or 11.6%, in interest and dividend income and a $871,000, or 84.2%, decrease in provision for loan losses, offset by a $2.4 million, or 35.5%, increase in interest expense, a $1.6 million, or 6.5%, increase in noninterest expense, a $344,000, or 55.2%, increase in provision for income taxes and a $104,000, or 4.9%, decrease in noninterest income.

Net Interest Margin

The net interest margin increased by 8 basis points to 3.83% for the three months ended September 30, 2019 from 3.75% for the three months ended June 30, 2019, while the net interest rate spread increased by 10 basis points to 3.44% from 3.34% for the same periods. Average interest-earning assets increased by $11.4 million, or 1.1%, to $1,010.9 million for the three months ended September 30, 2019 from $999.4 million for the three months ended June 30, 2019. The average yield on interest-earning assets increased by 10 basis points to 5.08% from 4.98%, for the same periods. Average interest-bearing liabilities increased by $19.1 million, or 2.5%, to $769.4 million for the three months ended September 30, 2019 from $750.3 million for the three months ended June 30, 2019. The average rate on interest-bearing liabilities was unchanged at 1.64% for both periods. 

The net interest margin decreased by 3 basis points to 3.83% for the three months ended September 30, 2019 from 3.86% for the three months ended September 30, 2018, while the net interest rate spread decreased by 5 basis points to 3.44% from 3.49% for the same periods. Average interest-earning assets increased by $59.7 million, or 6.3%, to $1,010.9 million for the three months ended September 30, 2019 from $951.2 million for the three months ended September 30, 2018. The average yield on interest-earning assets increased by 18 basis points to 5.08% from 4.90% for the same periods. Average interest-bearing liabilities increased by $65.3 million, or 9.3%, to $769.4 million for the three months ended September 30, 2019 from $704.1 million for the three months ended September 30, 2018. The average rate on interest-bearing liabilities increased by 24 basis points to 1.64% from 1.40% for the same periods.

Noninterest Income

Noninterest income decreased to $579,000 for the three months ended September 30, 2019, down $107,000, or 15.6%, from $686,000 for the three months ended June 30, 2019. The decrease was attributable to decreases of $112,000, or 42.7%, in late and prepayment charges related to mortgage loans and $26,000, or 15.1%, in other noninterest income offset by increases of $19,000, or 8.3%, in service charges and fees and $12,000, or 50.0%, in brokerage commissions.

Noninterest income decreased to $579,000 for the three months ended September 30, 2019, down $135,000, or 18.9%, from $714,000 for the three months ended September 30, 2018. The decrease was mainly attributable to decreases of $250,000, or 87.4%, in brokerage commissions and $26,000, or 15.1%, in other noninterest income offset by increases of $85,000, or 130.8%, in late and prepayment charges related to mortgage loans and $56,000, or 29.3%, in service charges and fees.

Noninterest Expense

Noninterest expense was $9.3 million for the three months ended September 30, 2019, up $627,000, or 7.2%, from $8.7 million for the three months ended June 30, 2019. The increase was mainly attributable to increases in professional fees of $223,000; occupancy and equipment of $211,000 as a result of prior quarter project completion expenses; compensation and benefits expense of $191,000 as a result of expenses related to new hires annual merit increase; insurance and surety bond premiums of $63,000; regulatory dues of $23,000 and office supplies, telephone and postage expenses of $10,000. The increase in noninterest expense was partially offset by decreases in other operating expenses of $57,000 mainly due to a credit from the Federal Deposit Insurance Corporation in the amount of $205,000 related to our FDIC deposit insurance assessment; and data processing expenses of $33,000.

Noninterest expense increased $565,000, or 6.4%, to $9.3 million for the three months ended September 30, 2019 from $8.8 million for the three months ended September 30, 2018. The increase was mainly attributable to increases in occupancy and equipment of $358,000 as a result of rebranding and branch renovation initiatives; compensation and benefits expense of $120,000 as a result of expenses related to restricted stock and stock options; other operating expenses of $90,000 as a result of increase in recruiting fees of $107,000 offset by a credit from the Federal Deposit Insurance Corporation in the amount of $205,000 related to our FDIC deposit insurance assessment; insurance and surety bond premiums of $59,000; and data processing expenses of $56,000 as a result of system enhancements and implementation charges related to software upgrades and additional products. The increase in noninterest expense was partially offset by decreases in direct loan expenses of $82,000; office supplies, telephone and postage expenses of $27,000 and professional fees of $22,000.

Asset Quality

Nonperforming assets increased to $10.3 million, or 0.94% of total assets, at September 30, 2019, from $10.1 million, or 0.96% of total assets, at June 30, 2019 and $6.6 million, or 0.67% of total assets, at September 30, 2018. The increase from June 30, 2019 is mainly attributable to an increase in nonaccrual, 1-4 family residential loans of $522,000.

There was a $14,000 provision for loan losses for the quarter ended September 30, 2019, compared to $0 for the quarter ended June 30, 2019 and $602,000 for the quarter ended September 30, 2018. The allowance for loan losses was $12.2 million, or 1.27% of total loans, at September 30, 2019, compared to $12.5 million, or 1.32% of total loans, at June 30, 2019 and $12.4 million, or 1.37% of total loans, at September 30, 2018. Net charge-offs totaled $372,000 for the quarter ended September 30, 2019, compared to net recoveries totaling $11,000 for the quarter ended June 30, 2019 and $13,000 for the quarter ended September 30, 2018.        

Balance Sheet

Total assets increased $40.1 million, or 3.8%, to $1,100.0 million at September 30, 2019 from $1,059.9 million at December 31, 2018. Net loans increased $30.0 million, or 3.3%, to $948.5 million at September 30, 2019 from $918.5 million at December 31, 2018. The increase in net loans was primarily due to increases of $18.6 million, or 21.2%, in construction and land loans, $3.9 million, or 1.0%, in 1-4 family residential and $12.1 million, or 5.2%, in multifamily residential loans, offset by a decrease of $4.7 million, or 29.7%, in business loans.

Steven A. Tsavaris, Executive Chairman remarked that, “while management remains optimistic about the loan production for the remainder of 2019, we are experiencing tough competition for refinancings accelerated by the decreasing interest rate environment." He also remarked that "loan originations remain close to the same levels as the previous year, but payoffs have increased as interest rates have declined."

Total deposits decreased $51.9 million, or 6.4%, to $757.8 million at September 30, 2019 from $809.8 million at December 31, 2018. The decrease in deposits was mainly attributable to decreases of $55.4 million, or 13.1 %, in certificates of deposit and $11.7 million, or 10.1% in demand deposits offset by an increase of $15.2 million, or 5.7%, in savings, NOW and money market accounts.

Total stockholders’ equity was $160.6 million at September 30, 2019, compared to $169.2 million at December 31, 2018. The Company and the Bank exceeded all regulatory capital requirements to be deemed well-capitalized at September 30, 2019. The Bank’s total capital to risk-weighted assets ratio was 19.29%, the tier 1 capital to risk-weighted assets ratio and the common equity tier 1 capital ratio were both 18.03%, and the tier 1 capital to total assets ratio was 13.62% at September 30, 2019, compared to 19.39%, 18.14%, and 13.66%, respectively, at December 31, 2018.  

On March 22, 2019, the Board of Directors adopted a share repurchase program effective March 25, 2019 through September 24, 2019. Under the repurchase program, the Company could have repurchased up to 923,151 shares of its common stock, or approximately 5% of the outstanding shares, which are to be used primarily to fund the grants of restricted stock units and stock options made under the Company’s 2018 Long-Term Incentive Plan. Repurchased shares are held by the Company as Treasury shares until used to fund the restricted stock units and option grants. A total of 886,325 shares were repurchased under the program before it expired on September 24, 2019. During the quarter ended September 30, 2019, the Company repurchased 409,347 shares of the Company’s common stock.

About PDL Community Bancorp

PDL Community Bancorp is the holding company for Ponce Bank. The Bank’s business primarily consists of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in mortgage loans, consisting of 1-4 family residences (investor-owned and owner-occupied), multifamily residences, nonresidential properties and construction and land, and, to a lesser extent, in business and consumer loans. The Bank also invests in securities, which have historically consisted of U.S. Government and federal agency securities and securities issued by government-sponsored or government-owned enterprises, as well as, mortgage-backed securities and Federal Home Loan Bank stock. The Bank offers a variety of deposit accounts, including demand, savings, money market and certificates of deposit. 

Forward Looking Statements

Certain statements herein constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements may be identified by words such as “believes,” “will,” “would,” “expects,” “project,” “may,” “could,” “developments,” “strategic,” “launching,” “opportunities,” “anticipates,” “estimates,” “intends,” “plans,” “targets” and similar expressions. These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to, adverse conditions in the capital and debt markets and the impact of such conditions on the Company’s business activities; changes in interest rates; competitive pressures from other financial institutions; the effects of general economic conditions on a national basis or in the local markets in which the Company operates, including changes that adversely affect borrowers’ ability to service and repay the Company’s loans; changes in the value of securities in the Company’s investment portfolio; changes in loan default and charge-off rates; fluctuations in real estate values; the adequacy of loan loss reserves; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; changes in government regulation; changes in accounting standards and practices; the risk that intangibles recorded in the Company’s financial statements will become impaired; demand for loans in the Company’s market area; the Company’s ability to attract and maintain deposits; risks related to the implementation of acquisitions, dispositions, and restructurings; the risk that the Company may not be successful in the implementation of its business strategy; changes in assumptions used in making such forward-looking statements and the risk factors described in the prospectus and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission (the “SEC”), which are available at the SEC’s website, www.sec.gov. Should one or more of these risks materialize or should underlying beliefs or assumptions prove incorrect, PDL Community Bancorp’s actual results could differ materially from those discussed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company disclaims any obligation to publicly update or revise any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes, except as may be required by applicable law or regulation.

PDL Community Bancorp and Subsidiaries
Consolidated Balance Sheets
(Dollars in thousands, except for share data)

	As of
	September 30,				June 30,				March 31,				December 31,				September 30,
	2019				2019				2019				2018				2018
ASSETS
Cash and due from banks:
Cash	$	6,425			$	6,003			$	5,690			$	45,225			$	5,494
Interest-bearing deposits in banks		40,965				47,007				35,877				24,553				16,895
Total cash and cash equivalents		47,390				53,010				41,567				69,778				22,389
Available-for-sale securities, at fair value		51,966				22,154				22,166				27,144				24,177
Loans receivable, net		948,548				934,236				925,099				918,509				893,884
Accrued interest receivable		3,893				3,773				3,735				3,795				3,609
Premises and equipment, net		32,805				32,205				31,777				31,135				29,293
Other real estate owned		—				58				—				—				—
Federal Home Loan Bank of New York stock (FHLBNY), at cost		8,659				4,609				2,915				2,915				2,621
Deferred tax assets		3,925				3,913				3,852				3,811				4,118
Other assets		2,802				2,158				2,485				2,814				2,620
Total assets	$	1,099,988			$	1,056,116			$	1,033,596			$	1,059,901			$	982,711
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits	$	757,845			$	802,408			$	806,781			$	809,758			$	764,792
Accrued interest payable		81				88				75				63				75
Advance payments by borrowers for taxes and insurance		7,780				6,059				8,099				6,037				7,219
Advances from the Federal Home Loan Bank of New York and others		169,404				79,404				44,404				69,404				37,775
Other liabilities		4,324				2,954				3,975				5,467				5,706
Total liabilities		939,434				890,913				863,334				890,729				815,567
Commitments and contingencies
Stockholders' Equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized, none issued		—				—				—				—				—
Common stock, $0.01 par value; 50,000,000  shares authorized; 18,463,028 shares issued and 17,576,703 shares outstanding as of  September 30, 2019 and 18,463,028 shares issued and outstanding as of December 31,2018		185				185				185				185				185
Treasury stock, at cost; 886,325 shares at September 30, 2019 and no shares as of December 31, 2018		(12,663	)			(6,798	)			(193	)			—				—
Additional paid-in-capital		85,750				85,357				84,976				84,581				84,557
Retained earnings		101,140				100,431				99,481				98,813				96,896
Accumulated other comprehensive loss		(7,947	)			(7,941	)			(8,035	)			(8,135	)			(8,101	)
Unearned compensation - ESOP; 591,062 shares as of September 30, 2019 and 627,251 shares  as of December 31, 2018		(5,911	)			(6,031	)			(6,152	)			(6,272	)			(6,393	)
Total stockholders' equity		160,554				165,203				170,262				169,172				167,144
Total liabilities and stockholders' equity	$	1,099,988			$	1,056,116			$	1,033,596			$	1,059,901			$	982,711

PDL Community Bancorp and Subsidiaries
Consolidated Statements of Income
(Dollars in thousands, except per share data)

	For the Quarters Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2019				2019				2019				2018				2018
Interest and dividend income:
Interest on loans receivable	$	12,663			$	12,060			$	12,095			$	12,026			$	11,483
Interest on deposits due from banks		117				278				149				170				141
Interest and dividend on available-for-sale securities and FHLBNY stock		173				76				138				130				113
Total interest and dividend income		12,953				12,414				12,382				12,326				11,737
Interest expense:
Interest on certificates of deposit		1,896				1,904				1,956				2,078				1,942
Interest on other deposits		759				821				631				320				272
Interest on borrowings		533				345				333				321				276
Total interest expense		3,188				3,070				2,920				2,719				2,490
Net interest income		9,765				9,344				9,462				9,607				9,247
Provision for loan losses		14				—				149				215				602
Net interest income after provision for loan losses		9,751				9,344				9,313				9,392				8,645
Noninterest income:
Service charges and fees		247				228				230				217				191
Brokerage commissions		36				24				109				108				286
Late and prepayment charges		150				262				139				278				65
Other		146				172				275				212				172
Total noninterest income		579				686				753				815				714
Noninterest expense:
Compensation and benefits		4,667				4,476				5,014				4,371				4,547
Occupancy and equipment		1,943				1,732				1,911				1,879				1,585
Data processing expenses		398				431				353				357				342
Direct loan expenses		183				182				156				217				265
Insurance and surety bond premiums		146				83				83				94				87
Office supplies, telephone and postage		281				271				317				349				308
Professional fees		956				733				510				1,025				978
Marketing and promotional expenses		46				47				26				68				40
Directors fees		69				73				83				69				69
Regulatory dues		70				47				56				60				63
Other operating expenses		575				632				582				585				485
Total noninterest expense		9,334				8,707				9,091				9,074				8,769
Income before income taxes		996				1,323				975				1,133				590
Provision for income taxes		287				373				307				498				188
Net income	$	709			$	950			$	668			$	635			$	402
Earnings per share:
Basic	$	0.04			$	0.05			$	0.04			$	0.04			$	0.02
Diluted	$	0.04			$	0.05			$	0.04			$	0.04			$	0.02

PDL Community Bancorp and Subsidiaries
Consolidated Statements of Income
(Dollars in thousands, except per share data)

	For the Nine Months Ended September 30,
	2019				2018				Variance $				Variance %
Interest and dividend income:
Interest on loans receivable	$	36,818			$	32,922			$	3,896				11.83	%
Interest on deposits due from banks		498				510				(12	)			(2.35	%)
Interest and dividend on available-for-sale securities and FHLBNY stock		433				399				34				8.52	%
Total interest and dividend income		37,749				33,831				3,918				11.58	%
Interest expense:
Interest on certificates of deposit		5,756				5,539				217				3.92	%
Interest on other deposits		2,211				655				1,556				237.56	%
Interest on borrowings		1,211				578				633				109.52	%
Total interest expense		9,178				6,772				2,406				35.53	%
Net interest income		28,571				27,059				1,512				5.59	%
Provision for loan losses		163				1,034				(871	)			(84.24	%)
Net interest income after provision for loan losses		28,408				26,025				2,383				9.16	%
Noninterest income:
Service charges and fees		705				627				78				12.44	%
Brokerage commissions		169				424				(255	)			(60.14	%)
Late and prepayment charges		551				327				224				68.50	%
Other		593				744				(151	)			(20.30	%)
Total noninterest income		2,018				2,122				(104	)			(4.90	%)
Noninterest expense:
Compensation and benefits		14,157				13,466				691				5.13	%
Occupancy and equipment		5,586				4,794				792				16.52	%
Data processing expenses		1,182				1,050				132				12.57	%
Direct loan expenses		521				572				(51	)			(8.92	%)
Insurance and surety bond premiums		312				275				37				13.45	%
Office supplies, telephone and postage		869				960				(91	)			(9.48	%)
Professional fees		2,199				2,130				69				3.24	%
Marketing and promotional expenses		119				147				(28	)			(19.05	%)
Directors fees		225				207				18				8.70	%
Regulatory dues		173				177				(4	)			(2.26	%)
Other operating expenses		1,789				1,705				84				4.93	%
Total noninterest expense		27,132				25,483				1,649				6.47	%
Income before income taxes		3,294				2,664				630				23.65	%
Provision for income taxes		967				623				344				55.22	%
Net income	$	2,327			$	2,041			$	286				14.01	%
Earnings per share:
Basic	$	0.13			$	0.11			N/A				N/A
Diluted	$	0.13			$	0.11			N/A				N/A

PDL Community Bancorp and Subsidiaries
Key Metrics

	At or for the Quarters Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2019				2019				2019				2018				2018
Performance Ratios:
Return on average assets		0.27	%			0.37	%			0.26	%			0.25	%			0.16	%
Return on average equity		1.71	%			2.26	%			1.59	%			1.49	%			0.95	%
Net interest rate spread (1)		3.44	%			3.34	%			3.46	%			3.52	%			3.49	%
Net interest margin (2)		3.83	%			3.75	%			3.86	%			3.90	%			3.86	%
Noninterest expense to average assets		3.54	%			3.38	%			3.59	%			3.57	%			3.54	%
Efficiency ratio (3)		90.24	%			86.81	%			89.00	%			87.07	%			88.03	%
Average interest-earning assets to average interest- bearing liabilities		131.38	%			133.20	%			133.93	%			134.30	%			135.09	%
Average equity to average assets		15.71	%			16.27	%			16.58	%			16.69	%			17.06	%
Capital Ratios:
Total capital to risk weighted assets (bank only)		19.29	%			19.54	%			19.32	%			19.39	%			19.60	%
Tier 1 capital to risk weighted assets (bank only)		18.03	%			18.29	%			18.06	%			18.14	%			18.35	%
Common equity Tier 1 capital to risk-weighted assets (bank only)		18.03	%			18.29	%			18.06	%			18.14	%			18.35	%
Tier 1 capital to average assets (bank only)		13.62	%			13.64	%			13.56	%			13.66	%			13.78	%
Asset Quality Ratios:
Allowance for loan losses as a percentage of total loans		1.27	%			1.32	%			1.33	%			1.36	%			1.37	%
Allowance for loan losses as a percentage of nonperforming loans		117.72	%			123.50	%			155.87	%			186.77	%			(186.74	%)
Net (charge-offs) recoveries to average outstanding loans		(0.15	%)			0.00	%			(0.16	%)			0.03	%			0.00	%
Non-performing loans as a percentage of total loans		1.09	%			1.08	%			0.86	%			0.73	%			0.73	%
Non-performing loans as a percentage of total assets		0.94	%			0.96	%			0.77	%			0.64	%			0.67	%
Total non-performing assets as a percentage of total assets		0.94	%			0.96	%			0.77	%			0.64	%			0.67	%
Total non-performing assets, accruing loans past due 90 days or more,  and accruing troubled debt restructured loans as a percentage of total assets		1.73	%			1.82	%			1.74	%			1.63	%			1.79	%
Other:
Number of offices	14				14				14				14				14
Number of full-time equivalent employees	187				183				185				181				175

(1)   Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(2)   Net interest margin represents net interest income divided by average total interest-earning assets.
(3)   Efficiency ratio represents noninterest expense divided by the sum of net interest income and noninterest income.

Key metrics calculated on income statement items were annualized where appropriate.

PDL Community Bancorp and Subsidiaries
Loan Portfolio

	For the Quarters Ended
	September 30,							June 30,							March 31,							December 31,							September 30,
	2019							2019							2019							2018							2018
	Amount				Percent			Amount				Percent			Amount				Percent			Amount				Percent			Amount				Percent
	(Dollars in thousands)
Mortgage loans:
1-4 family residential
Investor Owned	$	309,065			32.23	%		$	302,428			32.00	%		$	304,650			32.55	%		$	303,197			32.61	%		$	295,792			32.69	%
Owner-Occupied		90,843			9.47	%			92,904			9.83	%			95,449			10.20	%			92,788			9.98	%			95,464			10.55	%
Multifamily residential		244,644			25.51	%			238,974			25.28	%			234,749			25.09	%			232,509			25.01	%			219,958			24.31	%
Nonresidential properties		195,952			20.44	%			197,367			20.88	%			199,903			21.36	%			196,917			21.18	%			191,603			21.17	%
Construction and land		106,124			11.07	%			100,995			10.69	%			84,844			9.07	%			87,572			9.42	%			85,293			9.42	%
Total mortgage loans		946,628			98.72	%			932,668			98.68	%			919,595			98.27	%			912,983			98.20	%			888,110			98.14	%
Nonmortgage loans:
Business loans		11,040			1.15	%			11,373			1.20	%			15,101			1.61	%			15,710			1.69	%			15,832			1.75	%
Consumer loans		1,252			0.13	%			1,151			0.12	%			1,125			0.12	%			1,068			0.11	%			992			0.11	%
Total nonmortgage loans		12,292			1.28	%			12,524			1.32	%			16,226			1.73	%			16,778			1.80	%			16,824			1.86	%
Total loans		958,920			100.00	%			945,192			100.00	%			935,821			100.00	%			929,761			100.00	%			904,934			100.00	%
Net deferred loan origination costs		1,788							1,562							1,727							1,407							1,316
Allowance for losses on loans		(12,160	)						(12,518	)						(12,449	)						(12,659	)						(12,366	)
Loans, net	$	948,548						$	934,236						$	925,099						$	918,509						$	893,884

PDL Community Bancorp and Subsidiaries
Nonperforming Assets

	For the Quarters Ended
	September 30,				June 30,				March 31,				December 31,				September 30,
	2019				2019				2019				2018				2018
	(Dollars in thousands)
Nonaccrual loans:
Mortgage loans:
1-4 family residential
Investor owned	$	1,281			$	1,299			$	1,284			$	205			$	206
Owner occupied		1,052				479				933				1,092				1,098
Multifamily residential		—				7				13				16				—
Nonresidential properties		3,099				3,288				531				706				544
Construction and land		1,292				1,327				1,341				1,115				1,103
Nonmortgage loans:
Business		—				—				275				—				—
Consumer		—				2				4				—				—
Total nonaccrual loans (not including non-accruing troubled debt restructured loans)	$	6,724			$	6,402			$	4,381			$	3,134			$	2,951
Non-accruing troubled debt restructured loans:
Mortgage loans:
1-4 family residential
Investor owned	$	471			$	493			$	1,023			$	1,053			$	1,076
Owner occupied		2,488				2,499				1,972				1,987				1,990
Multifamily residential		—				—				—				—				—
Nonresidential properties		647				742				611				604				605
Construction and land		—				—				—				—				—
Nonmortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total non-accruing troubled debt restructured loans		3,606				3,734				3,606				3,644				3,671
Total nonaccrual loans	$	10,330			$	10,136			$	7,987			$	6,778			$	6,622
Real estate owned:
Mortgage loans:
1-4 family residential
Investor owned	$	—			$	—			$	—			$	—			$	—
Owner occupied		—				—				—				—				—
Multifamily residential		—				—				—				—				—
Nonresidential properties		—				—				—				—				—
Construction and land		—				—				—				—				—
Nonmortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total real estate owned		—				—				—				—				—
Total nonperforming assets	$	10,330			$	10,136			$	7,987			$	6,778			$	6,622
Accruing loans past due 90 days or more:
Mortgage loans:
1-4 family residential
Investor owned	$	—			$	—			$	—			$	—			$	—
Owner occupied		—				—				—				—				—
Multifamily residential		—				—				—				—				—
Nonresidential properties		—				—				—				—				—
Construction and land		—				—				—				—				—
Nonmortgage loans:
Business		—				—				—				—				—
Consumer		—				—				—				—				—
Total accruing loans past due 90 days or more	$	—			$	—			$	—			$	—			$	—
Accruing troubled debt restructured loans:
Mortgage loans:
1-4 family residential
Investor owned	$	5,226			$	5,267			$	5,157			$	5,192			$	5,224
Owner occupied		2,114				2,493				3,415				3,456				3,882
Multifamily residential		—				—				—				—				—
Nonresidential properties		1,317				1,330				1,428				1,438				1,449
Construction and land		—				—				—				—				—
Nonmortgage loans:
Business		35				37				40				374				398
Consumer		—				—				—				—				—
Total accruing troubled debt restructured loans	$	8,692			$	9,127			$	10,040			$	10,460			$	10,953
Total nonperforming assets, accruing loans past due 90 days or more and accruing troubled debt restructured loans	$	19,022			$	19,263			$	18,027			$	17,238			$	17,575
Total nonperforming loans to total loans		1.09	%			1.08	%			0.86	%			0.73	%			0.73	%
Total nonperforming assets to total assets		0.94	%			0.96	%			0.77	%			0.64	%			0.67	%
Total nonperforming assets, accruing loans past due 90 days or more and accruing troubled debt restructured loans to total assets		1.73	%			1.82	%			1.74	%			1.63	%			1.79	%

PDL Community Bancorp and Subsidiaries
Average Balance Sheets

	For the Three Months Ended September 30,
	2019									2018
	Average									Average
	Outstanding						Average			Outstanding						Average
	Balance			Interest			Yield/Rate (1)			Balance			Interest			Yield/Rate (1)
	(Dollars in thousands)
Interest-earning assets:
Loans	$	957,987		$	12,663		5.24	%		$	890,063		$	11,483		5.12	%
Available-for-sale securities		22,415			81		1.43	%			25,330			89		1.39	%
Other (2)		30,460			209		2.72	%			35,792			165		1.83	%
Total interest-earning assets		1,010,862			12,953		5.08	%			951,185			11,737		4.90	%
Non-interest-earning assets		35,840									32,634
Total assets	$	1,046,702								$	983,819
Interest-bearing liabilities:
NOW/IOLA	$	28,183		$	35		0.49	%		$	27,523		$	25		0.36	%
Money market		144,666			685		1.88	%			64,625			199		1.22	%
Savings		118,308			38		0.13	%			126,329			47		0.15	%
Certificates of deposit		379,915			1,896		1.98	%			435,159			1,942		1.77	%
Total deposits		671,072			2,654		1.57	%			653,636			2,213		1.34	%
Advance payments by borrowers		7,991			1		0.05	%			7,409			1		0.05	%
Borrowings		90,361			533		2.34	%			43,057			276		2.54	%
Total interest-bearing liabilities		769,424			3,188		1.64	%			704,102			2,490		1.40	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		109,491			—						105,376			—
Other non-interest-bearing liabilities		3,402			—						6,456			—
Total non-interest-bearing liabilities		112,893			—						111,832			—
Total liabilities		882,317			3,188						815,934			2,490
Total equity		164,385									167,885
Total liabilities and total equity	$	1,046,702					1.64	%		$	983,819					1.40	%
Net interest income				$	9,765								$	9,247
Net interest rate spread (3)							3.44	%								3.49	%
Net interest-earning assets (4)	$	241,438								$	247,083
Net interest margin (5)							3.83	%								3.86	%
Average interest-earning assets to interest-bearing liabilities							131.38	%								135.09	%

(1)   Annualized where appropriate.
(2)   Includes FHLBNY demand account and FHLBNY stock dividends.
(3)   Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(4)   Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)   Net interest margin represents net interest income divided by average total interest-earning assets.

PDL Community Bancorp and Subsidiaries
Average Balance Sheets

	For the Nine Months Ended September 30,
	2019									2018
	Average						Average			Average						Average
	Outstanding						Yield/Rate			Outstanding						Yield/Rate
	Balance			Interest			(1)			Balance			Interest			(1)
	(Dollars in thousands)
Interest-earning assets:
Loans	$	940,971		$	36,818		5.23	%		$	850,316		$	32,922		5.18	%
Available-for-sale securities		22,772			244		1.43	%			27,417			299		1.46	%
Other (2)		37,551			687		2.45	%			45,113			610		1.81	%
Total interest-earning assets		1,001,294			37,749		5.04	%			922,846			33,831		4.90	%
Non-interest-earning assets		35,142									33,815
Total assets	$	1,036,436								$	956,661
Interest-bearing liabilities:
NOW/IOLA	$	27,298		$	86		0.42	%		$	27,955		$	75		0.36	%
Money market		124,263			2,004		2.16	%			56,694			451		1.06	%
Savings		120,748			118		0.13	%			125,643			126		0.13	%
Certificates of deposit		408,241			5,756		1.89	%			438,121			5,539		1.69	%
Total deposits		680,550			7,964		1.56	%			648,413			6,191		1.28	%
Advance payments by borrowers		8,423			3		0.05	%			7,345			3		0.05	%
Borrowings		64,947			1,211		2.49	%			30,030			578		2.57	%
Total interest-bearing liabilities		753,920			9,178		1.63	%			685,788			6,772		1.32	%
Non-interest-bearing liabilities:
Non-interest-bearing demand		110,730			—						98,247			—
Other non-interest-bearing liabilities		4,087			—						5,555			—
Total non-interest-bearing liabilities		114,817			—						103,802			—
Total liabilities		868,737			9,178						789,590			6,772
Total equity		167,699									167,071
Total liabilities and total equity	$	1,036,436					1.63	%		$	956,661					1.32	%
Net interest income				$	28,571								$	27,059
Net interest rate spread (3)							3.41	%								3.58	%
Net interest-earning assets (4)	$	247,374								$	237,058
Net interest margin (5)							3.81	%								3.92	%
Average interest-earning assets to interest-bearing liabilities							132.81	%								134.57	%

(1)   Annualized where appropriate.
(2)   Includes FHLBNY demand account and FHLBNY stock dividends.
(3)   Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
(4)   Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5)   Net interest margin represents net interest income divided by average total interest-earning assets.

Contact:
Frank Perez
frank.perez@poncebank.net
718-931-9000